Lord Kalms speaks out

Lord Kalms

Not all businessmen support the UK’s membership of the EU.

CIB has produced a video of an interview with one senior figure who doesn’t. Lord Kalms,  the life president and former chairman of Dixons Retail  spoke to CIB’s chairman Petrina Holdsworth.

You can hear his comments by accessing this link

 

 

 

 

 

More Tory embarrassment over Europe

Conservative LogoIn the space of less than 24 hours, the Conservatives have suffered two major embarrassments, both related to the European Union.

Firstly came the immigration statistics. The 2010 Conservative manifesto pledged to bring net immigration down to below 100,000 by the end of this Parliament. Immigration data for the year up to September 2014, published on 26th February, showed that no fewer than 624,000 people came to the UK but only 327,000 left it.  Net migration, in other words, amounted to almost three times the numbers the Conservatives promised and 98,000 more than the previous year.

This is not just an EU-related issue. Migration from outside the EU, over which the Government has some control, rose significantly, with 190,000 more people from the rest of the world arriving than leaving. However, the arrival of a further 108,000 EU citizens is something which David Cameron can do nothing about and he has been forced, in as many words, to admit it. His putative talks of trying to restrict freedom of movement as part of the proposed UK renegotiations were dismissed out of hand by other EU heads of state and the European Commission almost as soon as he raised the subject.

Meanwhile, the smoke and mirrors game played by George Osborne regarding the Government’s response to the £1.7 billion extra surcharge inflicted on the UK by the EU last year has been exposed by a Committee of MPs. There was never any chance that our spineless government would have told the EU to get stuffed, but Osborne told Parliament that he had succeeded in reducing it by half. However, the Treasury Select committee said: “The suggestion that the £1.7bn bill demanded by the European Union was halved is not supported by published information.” In other words, Mr Osborne has been telling porkie pies. That would certainly be a reasonable paraphrase of the comments made by Chris Leslie, the shadow Chief Secretary to the Treasury, who said, “He must now apologise to taxpayers for making this completely false claim.”

Some hope! However, at a time when opinion polls are pointing to a slender Tory lead and a decline in UKIP support, once again EU-related issues have flared up with a vengeance. The Conservatives’ failures over Europe have been laid bare once again and may well cost them dearly at the ballot box next May.

Tsipras has taken a quick lesson in Euro-speak

Greece’s new Prime Minister Alexis Tsipras has proved a quick learner. After less than a month in office, he has finally mastered the great quality of fudge necessary for dealing with the EU institutions. Mind you, it remains to be seen how convinced the Greek people will be that his capitulation to the hated “troika” was a victory. Before last Friday’s capitulation, he enjoyed a level of popular support which most Prime Ministers could only dream of – 75%. Unless the Greek people are particularly gullible, it is hard to imagine his government retaining its popularity for long.

Tsipras’ statement on Friday that “We kept Greece standing and dignified” was a masterpiece of Euro-Speak. He went on to say that the agreement with Eurozone finance ministers “cancels austerity” and added: “In a few days we have achieved a lot, but we have a long road. We have taken a decisive step to change course within the euro zone.” Reality is very different. Tsipras declared Greece was “leaving austerity, the bailouts and the troika behind” but has been forced to continue with austerity and extend the bail-out. As for the hated “troika (the ECB, the IMF and the European Commission), Syriza has secured an agreement not to use the name “troika”, but these three bodies, now referred to as “the institutions” will still oversee Greece’s bailout.

It promised to push through a series of anti-austerity measures including upping the minimum wage, scrapping taxes and re-hiring a number of civil servants. Instead, it has had to promise not to roll back the reforms introduced by previous governments or introduce any controversial measures during the four-month period of negotiations on a new long-term deal. Although Syriza has managed to reduce the agreed level of primary surplus it must achieve and has at least been able to suggest which reforms it would like to implement, they must be agreed by the other Eurozone countries. It is, to all intents and purposes, a total capitulation.

Wolfgang Schäuble, the German finance Minister rubbed salt into the wounds when he said, “Being in government is a date with reality, and reality is often not as nice as a dream.” In other words, “this immature group of idealists has had to grow up quickly.” Herein lies Syriza’s problem. The party promised the impossible. The country is bust, its main creditors are fellow-EU member states and the only alternative to years of grinding cuts would have been an Iceland-style banking crash which would have forced Greece out of the Eurozone and possibly the EU as well. It would have meant a spike in inflation and things getting even worse before they got better. Faced with these tough choices, Tsipras and his finance minister Yanis Varoufakis blinked and rolled over.

What this will mean to those many Greeks who celebrated the Syriza victory with such enthusiasm less than a month ago remains to be seen. There may be issues within Syriza itself which, as has been pointed out before, is not a monolithic political party but an association or coalition of left-wing factions, some of which may not be willing to go along with this humiliation. PASOK, which Syriza has replaced as the main party of the left, was soon on the attack. “No propaganda mechanism or pirouette can hide the simple fact that they lied to citizens and sold illusions” said Evangelos Venizelos, the party leader.

In summary, Greece has secured for itself a four-month extension to the current deal at the price of an embarrassing climbdown which the party’s leadership has tried to disguise as a victory. It saves Greece’s banks from collapse for the time being while still leaving the most critical question unanswered:- How is a country that may no longer even be able to achieve a primary surplus bring down its vast debt of 175% of GDP? The markets may be happy at Friday’s deal, but it may yet prove a false dawn – a lull in, rather than a termination of, the Eurozone’s woes.
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A spectacular future

If any backbench MP or minor businessman says that withdrawal from the EU would be a disaster, you can bet your life that their comments will be splashed all over the press the following day. However, a recent gathering of heavyweight academics, politicians and figures from industry sending out a very different message seems to have received precious little coverage in the media.

The Conservative MEP David Campbell Bannerman was the moving sprit behinds last week’s conference entitled “Alternatives to EU Membership: What are the UK’s options?” Among the speakers was Owen Paterson MP, the former Environment minister. He did not mince his words. “We have to leave”, he said, adding, “I see a huge optimistic vision for this country, a really spectacular future, but to do it and to get there, we have to leave.”

John Mills, a CIB Committee member and Chairman of the Labour Euro Safeguards Committee, delivered a stark warning to his party leader: “If Ed Miliband becomes Prime Minister in May and renegotiates without committing to a referendum, he will inevitably weaken the UK’s bargaining position. Minds in Brussels are much more likely to take renegotiation seriously if they know that there is a substantial risk that the UK will leave the EU if there is not a satisfactory deal on the table to persuade the UK to stay in”, he added.

Another Tory MP, Bill Cash, finally answered a question has kept many supporters of withdrawal guessing for years:- does he support withdrawal or not? We finally received the answer. “There is no alternative except moving to exit”, he told the gathering. “There is more nationalism now. There is chaos, less peace, less democracy. There are riots, protests, economic instability. Implosion is imminent, or the alternative is irresponsible coercion of the kind being imposed on the Greeks now.”

Another myth was shattered. Not all senior figures in the American political scene want us to stay in. Dr Nile Gardiner, a former aide to Margaret Thatcher who is now based at the Heritage Foundation think tank in Washington DC addressed the conference using a video link. “The biggest threat to the Special Relationship is the European project itself, exemplified by the grandiose dreams of a European super-state”, he said. “Nothing could be worse for America than a Britain that is unable to act independently, straight-jacketed by a forced common foreign and security policy.”

The same day as the conference was staged, a detailed rebuttal of the “three million jobs would be lost if we left” myth was published by Global Britain and the Democracy Movement. Far from worrying about job losses on independence, the report expressed concern about the jobs that would be lost by not leaving. Stuart Coster, the Democracy Movement’s campaign director said: “This report demolishes once and for all the EU lobby’s scaremongering about jobs should Britain choose to leave the EU and reveals reality as the opposite of their claims.” (The full report can be downloaded here)

Such a shame that a day of great hope for our country’s future was largely ignored by most of the daily papers. Apart from the Daily Express, from which some of this information was gleaned, the only other coverage of the Bannerman conference came in the shape of a rather sneering report in The Independent Well, let them sneer. The speakers at the conference were promising, in Mr Bannerman’s words, a “far better, freer and more prosperous future outside the EU”. Anyone who turns their noses up at such an exciting prospect and continues to support our country’s bondage to this club of failures is worthy only of contempt.

The EU: A Corporatist Racket

 

EU a Corporatist Racket

By Dave Barnby

A review by Edward Spalton

Many books have covered the ideological origins of what is now the EU. This book describes the manoeuvres of the the principal post war actors whose guile, determination and deceit contrived progressively to deprive our country of its constitution and liberty whilst pretending to engage in mere facilitation of trade ( “The Common Market”) and international co-operation. It is a thorough job, backed by detailed research with frequent facsimile documents from public archives.

From the early post war years, it traces the growth of the European Movement, saved from bankruptcy by substantial CIA funds and by American corporate money. Whilst the subjects will be familiar to most independence campaigners, the author’s angle of approach is refreshingly different.

The first part (of 11 chapters) begins with the lie of “no essential loss of sovereignty” and covers the conversion of the civil service from its politically impartial role to an agency of “government against the people”. In a role reversal, the Foreign Office devoted much of its energy to promoting the foreign European project to the British people whilst using public money to frustrate and discredit those campaigners, who knew what was really at stake.

Drawing on official records, the author makes a strong case on the balance of probabilities that Britain’s abandonment of the Black Arrow satellite launcher was part of the price of entry to the EEC, giving the French a monopoly in the European space programme. He also covers the subversion of the apparently innocent business of town twinning into a scripted process, requiring participating towns to declare allegiance to the European project.

The second part ( 9 chapters) “European Integration, the broader picture 1948 -2014” begins with a review of the ACUE (American Committee for a United Europe – funded by corporate donations) and the European Movement. It includes an in depth study of the 1975 referendum, how the process was skewed and was certainly open to electoral manipulation. Whilst this is informed conjecture, similar complaints by those taking part in later Irish referendums should alert any independence campaigner. There is an extremely interesting piece on “85 Frampton Street” , the media centre for Britain in Europe which the author visited in 2003 when a referendum on the euro currency was in the air. Campaigners should know of the scale of publicity machine available to our foes and its cosy existing relationship with the media. Bilderberg is covered in a matter-of-fact sort of way and the attempts within the Conservative party to discredit their Eurosceptic MPs.

The endpiece, entitled “The Rats” makes some proposals to break the power of the supranational corporations in the supranational state but the author has not yet fully developed his ideas. Few who experienced the reality of nationalised industries would wish to revisit them.

In the meantime, this highly original account will be extremely useful both as a readable record and as a mine of verified quotations for anyone speaking or writing on how our country came to its present state.

ISBN 978-0-9569815-8-5 Paperback 185 pages

Price £9.99 plus postage and packing £2.00

Available from David Barnby
64 New Yatt Road
Witney
OX28 1PA
Tel 01993 704421
Email [email protected] 

Migration, the deficit and the recovery

Anthony ScholefieldOne of the matters I raised at a meeting in the House of Commons on Tuesday 16th December was:

The effects of mass immigration are now so large
that they are impacting on the economy as a whole and, specifically,
on the deficit, the debt and the ‘recovery’

The ‘Recovery’ and the Deficit are linked

– The import of a large migrant workforce has inevitably added to total GDP so nearly one per cent of growth of total GDP p.a. can be put down to simply having more workers and consumers. Those enthusing over the ‘recovery’ should be aware of this.

It is standard economic theory that immigration transfers income from newly plentiful factors to newly scarce factors, that is, from labour to capital. What is not noticed, however, is that much capital in the UK is now foreign owned so the transfer also is in part from British workers to foreign capitalists. Foreign capitalists get dividends and capital gains tax free. Moreover, due to the tax regimes in Ireland and Juncker’s Luxembourg, a great deal of foreign corporations’ profits in the UK are, effectively, lost to the British tax system under ‘freedom of capital’.

– The way the tax system for workers is now set up means that low earners (and migrants are overwhelming so) pay little tax and actually get tax refunds. Additionally, of course, they place demand on the existing ‘public services’ such as schools, hospitals, etc.

– Further out there are plans and projects for more public capital spending on transport, housing, schools, etc., as well as, unseen, capital diversion to provide the private sector tools and assets that migrants require: factories, office blocks, shops, houses, etc.

It should be noted that there is a great difference between employing existing natives who already have their ‘social capital; in the form of housing, roads, dams, etc., and migrant workers who require equipping with appropriate capital items from the ground up. The capital both extra native and migrant workers need (and this need is common) is for ‘the tools of production’: factories, equipment, office buildings, etc.

– The electorate are aware, even if the political class is not, that migrants send much of their savings abroad. There is no proper counting of this; it all relies on Office of National Statistics (ONS) speculation and guesstimates as is admitted, but it is several billion pounds a year.

In any case annual savings by migrant workers or their employers are far too small to provide the capital they require to operate and live in the British economy (less than 1% p.a.). This phenomenon means that the capital to equip migrants has to be found mainly by natives either by taxation or by capital diversion.

– All of this means, therefore, there must be appropriation from the taxpayer to fund extra current expenditure and the extra capital requirements of the public sector. These expenditures count as GDP growth but, of course, do nothing for the incomes and wealth of native workers. Actually they reduce both.

– Therefore, the ‘recovery’ with high inward migration may mean a statistical increase in aggregate GDP but produces little tax revenue either from workers or capitalists and places extra demand on public sector investment and current spending on the public services. Migration also diverts capital investment from natives to equipping migrants by the process of capitalists re-ranking the profitability of investments as the economy changes shape. In this way capital intensification is reduced for native workers; therefore reducing their income. It is not just the political catchphrase, ‘pressure on the public services’, it is pressure on the private sector and on capital formation. Instead of capital intensification for natives, there is capital diversion to equip and supply migrants.

– By not taking strong steps to rein in migration, the government is making its task of reducing the deficit much harder to achieve and makes the ‘recovery’ a statistical mirage with little effect on native income. It also is deceiving itself, as much ‘capital investment’ adding to GDP statistics is simply a means of equipping more workers in the economy.

When considering the ‘recovery’, it is also worth noting that the GDP deflator has been rebased and effectively reduced since 2008. A reduction in the GDP deflator means that ‘real GDP’ is statistically increased. Thus a further part of the ‘recovery’ is also a statistical mirage.

Another point on the GDP deflator is that the fall in crude oil prices will, for about a year, mean a higher GDP deflator as price falls in imports add to the GDP deflator and, therefore, increase the statistical overall ‘growth’ or real GDP and the ‘recovery’.

The Debt

– In addition to the massive increase in government debt, the off balance sheet liabilities for state pensions and healthcare are mushrooming all the time and have not been recalculated since 2010. To enthuse over GDP growth, but not calculate off balance sheet liabilities, is living in a fool’s world.

Even the hoariest of all false factoids, that immigrants are needed to pay for British pensions, keeps returning. For example, in the New Statesman on 5th December 2014:

“There is a truth that no politician will utter: if Britain is to maintain a welfare state … its current economic model demands more immigration.”

Yet every study by the UN, OECD or the Home Office, has always come to the conclusion of Chris Shaw, the government actuary, writing in 2001:

The single reason why even large constant net migration flows would not prevent support rates from falling in the long term is that migrants grow old as well.”

The UN calculates that, to maintain the UK worker/dependant ratio, the UK would have to support 60 million immigrants by 2050 and, by then, migration would be running at 2.2 million per annum, and increasing.

This is a dead-end in thinking.

– The accumulated, to date, off balance sheet liabilities for state old age pensions (not including public sector retirement pensions) were last calculated in 2010. They had then increased from £1.3 trillion in 2005 to £3.5 trillion in 2010 according to the Department of Work and Pensions. With the guaranteed 2.5% increase in pensions per annum, even in times of low inflation, the off balance sheet liabilities since then are increasing alarmingly. The fall in interest rates may also have a massive effect as the ONS states, “For example, reducing the discount rate to 4 per cent leads to a 31% increase in total pension entitlements (by £1,174 billion)”.

In 2010 the ONS used, in alignment with Eurostat, a rate of 5 per cent (nominal) for its discount. The rate is based on high quality corporate bonds yield. Rough calculations are that discount rates for corporate bonds are now in the region of 3.5 per cent. This means that the off balance sheet liabilities for state pensions at 2010 have risen to the area of £5.3 trillion – and this does not make any provision for the rises since 2010 or those built into the Coalitions’ pension promises.

Quite evidently, pension promises are quite out of control. Adding more lower paid migrants is adding to the liabilities with little contribution to the costs.

The Future

One can therefore forecast that:

  •  Capital employed per head will be static or reduce
  • Native incomes will remain static at best.
  • The ‘recovery’ will only partially reduce the deficit.
  • Taxes on capital and labour will fall short of projections.
  • The deficit will persist.
  • Debt and off balance sheet liabilities will continue to mushroom.